The Central Bank of Brazil has decided to cap debit card fees paid by merchants to card issuers, called interchange fee, to lower charges for consumers.
Set to be effective from 1 October 2018, a limit of 0.8% of transaction values will be applicable and the average will not exceed 0.5%, reported Reuters.
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The publication quoted the central bank director Reinaldo Le Grazie as saying that the new regulations will reduce the bank’s revenue from these transactions by approximately 40%.
Statistics show a rise in interchange fees from 0.79% to 0.82% over the past eight years. Fees paid by businesses, which also include transfers to payment processors such as Cielo and PagSeguro Digital, commonly range between 1% and 3% of the transaction value in Brazil.
The central bank further informed that the ceiling could be further extended, while a cap on maximum debit card transactions value could be removed or a cap on credit card interchange fees might be imposed.
Le Grazie added: “Our goal is that debit cards are used for payment and credit cards are used for credit.”
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